Laid-off tech workers raise cash for FrugalMechanic |
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Laid-off tech workers raise cash for FrugalMechanic
Two laid off Seattle area technology workers have scored seed funding for a new comparison shopping engine for auto parts called FrugalMechanic.com. Eric Peters and Tim Underwood started the Web site last summer after losing their jobs at SecondSpace, an online site for second homes and vacation properties. The former roommates at the University of Washington kept working on the idea after they were encouraged with earning $100 in revenue in the first month.
FrugalMechanic attracted about 160,000 unique visitors last month, with Peters saying the two-person startup will break even soon. The 27-year-old former Microsoft and Amazon.com employee said they were able to more easily raise the money because it is nearing profitability.
Founders Co-op, an angel investment firm led by Andy Sack and Chris DeVore, led the deal. Between $250,000 and $500,000 was invested.
FrugalMechanic operates a comparison shopping service, earning revenue by passing leads on to established retailers. Peters said the average automotive part purchase is about $150, with affiliate fees ranging from eight to 15 percent.
In addition to the funding, FrugalMechanic also inked a deal to provide its service to Seattle-based CarDomain. Peters said the goal is to offer the shopping service to other automotive sites.
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